Goldman Sachs redundancy case shows why process and evidence matter

Mr Reeves had worked at Goldman Sachs since 2007 and transferred to London in 2013. He later became Deputy Global Head of the bank’s Control Room, part of its Compliance Division. The Tribunal heard that he had been placed in the top quartile of his peers every year from 2012 to 2019 and was seen by managers as having strong technical expertise.

Goldman Sachs had introduced a policy allowing employees to take up to 26 weeks of paid leave within 12 months of the birth or legal adoption of a child. The Tribunal noted that this policy went beyond the bank’s legal obligations.

While Mr Reeves was on parental leave, he was told for the first time that he was underperforming. His pay was later reduced by 5%. The Tribunal considered whether those decisions were properly supported by the evidence, including his previous performance history and the formal feedback available at the time.

The redundancy process was also challenged. Internal communications referred to Mr Reeves’ “termination” before he had formally been told his role was at risk. Two colleagues who had covered parts of his role while he was away were later appointed as permanent co-heads. The Tribunal found that Goldman Sachs had not shown a potentially fair reason for dismissal and had failed to follow a fair process.

A redundancy label is not enough if the evidence does not support it. Goldman Sachs argued that Mr Reeves’ dismissal was connected to redundancy or business reorganisation, but the Tribunal found that the need for employees to carry out the relevant work had increased rather than reduced.

The Tribunal was critical of several parts of the process, including:

• no proper consultation
• no fair selection pool
• no objective scoring exercise
• no meaningful comparison with the colleagues who replaced him
• no genuine effort to find suitable alternative work
• internal records suggesting the outcome had already been decided

The Tribunal also considered subjective performance language regarding other employees. Comments such as “crushing it” or “star performer” did not replace the need for an objective comparison.

Employees may be told that a decision is about performance, pay, restructuring or redundancy. Sometimes that will be genuine; however, where the explanation does not match the records, the timing feels wrong, or the process appears to have been decided in advance, specialist legal advice may be needed.

Warning signs may include:

• sudden criticism after a strong performance history
• pay or bonus decisions with no clear explanation
• being excluded from meetings, systems or organisational charts while on leave
• internal communications suggesting a decision has already been made
• no proper consultation before redundancy
• no clear selection pool or scoring process
• colleagues being appointed into similar roles without fair comparison
• little or no effort to consider alternative vacancies

Sex discrimination claims are not limited to women or maternity-related claims. The Tribunal considered whether Mr Reeves, as a man taking extended leave connected with childcare, had been treated less favourably than a hypothetical female employee taking equivalent leave. The judgment also considered evidence that managers had been dismissive of him, as a man, raising childcare difficulties.

Employees who are concerned about performance criticism, reduced pay, redundancy or dismissal should keep copies of relevant documents where they can. This may include emails, messages, appraisals, meeting notes, pay communications, redundancy letters and correspondence about family leave or childcare responsibilities.

In many cases, the evidence is not one dramatic comment or incident. The timing of events, previous performance records, internal communications and the way alternatives were handled can all help show whether the employer’s explanation stands up to scrutiny.

Employment Tribunal time limits are strict. In many cases, a claim must usually be started within three months less one day of the act complained of, and Acas Early Conciliation will usually be required before a claim can be brought. Acas is the UK’s independent public body for workplace advice, dispute resolution and employment rights guidance.